Tuesday, January 12, 2010

Why do Employers Fight Unemployment Claims?

Why do employers fight unemployment claims?  After all, unemployment benefits are paid by the state, not by the individual employer.  What employers do pay is an unemployment tax.  The amount of that tax is determined by the number of claims an employer might have.

For a large employer with lots of claims, it is probably worth it to fight.  However, for small employers, it probably isn't worth it, unless the employer has an axe to grind.  Sometimes, though, the axe rebounds.

I had one case several years ago where one brother fired another brother who worked for him.  The fired brother asked the employer brother not to fight his unemployment claim.  He did.  The fired brother ended up going to the Department of Labor and reporting massive cheating on prevailing wage projects.  The employer brother ended up losing his business.

Recently I met with a worker who was fired from a small business after he called in sick.  Well, actually, he called to say that he and his pregnant wife had been in a car accident and were going to the hospital.  This employee had missed some work, not a lot, because of a medical condition; the employer does not have a sick policy.  The employer is fighting this worker's right to unemployment benefits.

After meeting with the worker I was outraged by the unfair treatment, and tried to figure out a way to help him.  Turns out that the employer is probably covered by the FMLA because he owns a few other satellite businesses that push him over the 50 employee FMLA requirement.  Now I'm looking into an FMLA claim.

The employer gained absolutely nothing by fighting the unemployment benefits of a man who just had a baby and also a car crash.  Because the employer fought this man's unemployment benefits, he now stands to lose a lot more.  Was it worth it?

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